Bitfarms and Riot Platforms Reach Settlement on Shareholding

A settlement between mining companies Bitfarms and Riot Platforms prohibits the latter from acquiring more than 20% of its competitor’s shares without board approval, according to a joint press release.

Under the agreement, Bitfarms co-founder Andres Finkelstein has stepped down from the management team, with Amy Friedman, an independent expert in corporate governance and capital markets proposed by Riot, taking his place.

The decision took effect immediately upon the publication of the notice.

Riot also agreed to customary standstill provisions until Bitfarms’ annual meeting in 2026, with certain exceptions.

In November, Bitfarms shareholders will be asked to approve the expansion of the board from five to six members and elect a new one, as well as ratify the company’s shareholder rights plan from July 24, 2024.

At that time, the Canadian firm adopted a new poison pill plan to limit the accumulation of securities.

In return, Bitfarms will grant Riot rights to purchase shares if it owns 15% or more of the outstanding common stock.

“We are pleased to reach this agreement with Riot and look forward to fully focusing on executing our growth strategy. We remain committed to diversifying our business beyond bitcoin mining into exciting and synergistic new areas such as energy production and trading, heat recycling, and other high-margin revenue sources like HPC or AI,” said Bitfarms CEO Ben Gagnon.

Riot CEO Jason Les also supported the plan and expressed the intention to find a “constructive solution” regarding the merger of the firms’ shareholder value.

In August, Riot Platforms increased its stake in Bitfarms to 18.9% as part of a hostile takeover strategy.

Earlier in September, the Canadian miner finalized an agreement to acquire American competitor Stronghold Digital Mining. The deal is valued at approximately $125 million.